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Closing Protection Letters (CPL)

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What is it?

A Closing Protection Letter (CPL) basically provides you additional protections and assurances against losses arising out of the negligent actions of the Title Insurance Company's authorized issuing Title Agent, in connection with the closing of your real estate transaction. Key protections of a CPL includes the following:

Colorado Title Insurance Regulation 8-1-3 allows title insurance companies (aka. title underwriters), at their option, the ability to issue a CPL to buyers, sellers, borrowers, and lenders. The American Land Title Association ("ALTA") the title industry's national trade organization has a promulgated CPL form (view sample CPL) that is typically used by the title insurance industry.

Regulation 8-1-3 requires that if a charge for a CPL is to be made, the cost must be filed with the Division of Insurance; however, a Title Insurance Company may issue a CPL at no charge. Additionally, Regulation 8-1-3 requires the Title Insurance Company to provide you with a disclosure statement within your title commitment, as to the availability of a CPL for your real estate transaction.

Do I need it?

It is highly recommended that you, whether as a buyer, seller, borrower, and lender obtain a CPL for your real estate transaction when doing business with a title agent/ title company.

How do I get one?

Ask your real estate broker or mortgage lender, when they're recommending and ordering your title insurance and closing services, to request and obtain a CPL on your behalf; or just contact your selected Title Company directly.

Also, CompareTitleCompanies.com can assist when running a quote; as the detailed summary, will identify whether the Title Insurance Company will issue the appropriate CPL and for what charge.

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